Performance Royalty Debate Rages On

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This is Celia Hirschman with On the Beat for KCRW.

The debate over whether broadcasters should pay a performance royalty is one of the music industry's hottest topics. Just two weeks ago, the Senate Judiciary Committee, approved a bill that would require broadcast radio stations to compensate artists and labels whenever music is aired. To date, no compensation has been paid to artists and labels for over-the-air broadcast of music. Songwriters, publishers and composers earn all royalties from radio airplay but artists and record labels do not. In fact, Frank Sinatra, Perry Como and Bing Crosby all fought to have a performance royalty right, but they did not win the debate in Congress.

Broadcast radio has been exempt from paying this royalty because they've always argued that artists and labels benefit from the financial gain of record sales created from airplay and therefore do not need additional compensation.

That argument may have had substance in 1972, but it holds little value today. Broadcast radio airplay has a minimal impact anymore. Few artists receive concentrated radio airplay. Plus given that radio listeners also now listen to Internet, satellite and cable music television, broadcast music ratings have dropped.

With the drop in ratings comes a drop in revenue. Some radio stations argue that any additional costs could mean the end of music on the radio.

Of course, this is just a scare tactic. Consider the facts. The United States is one of the only industrialized nations that does not compensate its singers and record labels for broadcast airplay. How can radio possibly argue against paying artists? Broadcast radio has built their entire business model on the quality and craftsmanship of the artists they play. Their choice in music literally defines the station and their revenue stream. And considering that all Internet, satellite and cable music television already pay performance royalties to artists, it makes no sense that broadcast radio is exempt. Are we literally saying that Clear Channel, CBS, Citadel and Entercom, four of the largest radio conglomerates can't afford to pay recording artists for their work? Give me a break.

But do not underestimate the power of the broadcast radio lobby. They have been highly persuasive with politicians over this matter in the past.

The only way to make change is to consider the artists. They deserve to be compensated for their efforts. And if the US performance royalty wasn't unfair enough, because the United States does not recognize a broadcast radio performance right, radio stations in countries that do collect performance royalties, do not have to pay American artists. That means that hundreds of millions of dollars is being kept from artists here and abroad.

In reality, broadcast radio's argument against the performance royalty is a pretty transparent attempt to avoid taking financial responsibility for the artists they play. While decades have passed and politicians have vetoed a change in the performance royalty policy, perhaps the time has finally come to overturn this antiquated ruling. As Patrick Leahy, the Democrat from Vermont said, “The radio station sells advertisement time and makes money off the performer's sound recording, but the artist does not get compensated. That is wrong and our bill corrects this injustice.”

Couldn't have said it better.

This is Celia Hirschman with On the Beat for KCRW.